Illinois Governor Wants to Leave Ride-Share Regs Up to Cities

Democratic Gov. Pat Quinn on Monday vetoed legislation that would have established statewide regulations on ride-sharing services that compete with taxis, saying he didn't want to put in place a "one-size-fits-all approach" on an industry best regulated at the local level.

The re-election seeking governor's move drew up a thumbs-up from Mayor Rahm Emanuel, Uber, Lyft, and even Republican governor challenger Bruce Rauner, who had called on Quinn to block the bill.

But the veto was criticized by taxi drivers and the legislation's sponsors, one of whom called it a victory for ride-share companies that serve posher Chicago neighborhoods while mostly ignoring residents in working class areas of the city.

In ride-share services, drivers use their private vehicles to give rides to people who request them via online apps. The measure would have set standards for vehicle safety, including requirements for insurance coverage, and rules that would have made the dispatchers of the vehicles liable for damages in accidents while the drivers are using their personal cars for ride sharing. It would have allowed car insurers to deny coverage to ride-share drivers at the times when they were using their vehicles for ride-share work.

"To rush into a whole new system of statewide regulations before the need for one is clear would stifle innovation. It would also be a disservice to consumers," Quinn wrote in an email to campaign supporters.

Sponsoring Rep. Michael Zalewski, D-Riverside, said he will consider seeking a vote to override Quinn during the General Assembly's post-election session.

"I disagree with the contention that this should be decided only locally, as these services stretch across city and county lines and the bills would provide important baseline protections that local governments could build upon," Zalewski said in a statement.

"They don't go to the Southeast Side, The Bush in the 10th Ward of the city of Chicago. They don't come to Gage Park on the Southwest Side of Chicago, to Little Village. They just stay to Wicker Park, Wrigleyville," said Sandoval at a news conference with taxi industry supporters at the Thompson Center.

But Chris Taylor, general manager of ride-share company Uber Chicago, said Quinn's veto shows his commitment to keeping transportation options affordable in Illinois. And Taylor countered that the veto will be a boon for residents of underserved neighborhoods, which he said ride-share drivers do a better job of serving than taxis.

"The people of Illinois overwhelmingly support ride sharing -- this veto is a victory for them against the influence of Big Taxi," Taylor said in a statement.

Many taxi medallions in Chicago are owned by a handful of wealthy individuals. But cab driver Javad Rahmaniasl said he and his wife own just two medallions between them, and that they and thousands of small operators like them are seeing their most important investments go down the tubes as medallions fall in value because of the relatively lax rules imposed on the ride-share industry. "We don't have any pensions, retirement, anything else," he said.

The Chicago City Council passed its own ride-share regulations in May, a package endorsed by Emanuel that requires driver training, background checks and vehicle inspections, and tougher licensing and insurance requirements. It also prohibits ride-share drivers from picking up passengers at the airports and McCormick Place. The ordinance will take effect next week, according to the mayor's office.

Cab drivers say the city rules don't go nearly far enough to level the regulatory playing field, while Emanuel has hailed the Chicago ordinance as an important step.

Emanuel sent out a statement thanking Quinn for the Monday veto, saying now "new transportation options can flourish in Chicago while consumers are ensured a safe and reliable experience."

The ride-sharing legislation got 80 votes in the House and 46 in the Senate, both enough to override the governor's veto. Those numbers could be fluid, however, given that issue has attracted a who's who of Springfield lobbyists.

Uber executive David Plouffe, former campaign manager and White House adviser to President Obama, said Wednesday new ride-share legislation in Washington was a model for Philadelphia and other cities.
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